Form 8938 Does Not Relieve Filers of FBAR Filing Requirements:

If you are required to report the value of offshore accounts on an FBAR Form 114 (formerly TD F 90-22.1), you must do so even if you are obligated to file Form 8938 (for FATCA reporting). Certain foreign financial accounts are reported on both Form 8938 and the FBAR FinCEN form 114.

However, the information required by the varys from case to caase. Different rules, key definitions and reporting requirements apply to Form 8938 and FBAR reporting. Because of these differences, certain foreign financial accounts may be reported on one but not both forms.

The due date for FBAR filing is June 30 for financial accounts for which the filer had a financial interest or signature authority during the previous calendar year. While the FBAR is filed electronically through the Financial Crimes Enforcement Network’s BSA E-filing System, Form 8938 is due with your annual income tax return and filed with the applicable IRS service center.

Specified foreign financial assets held outside of an account with a financial institution are reported on Form 8938, but not reported on the FBAR.

Form 8938: The total exceeds $200,000 on the last day of the tax year or more than $300,000 at any time during the year, or double that if filing a joint return

Definition of Interest in an Account or Asset

Form FINCEN 114: Financial interest: You, your agent or representative is the owner of record or holder of legal title, or you have a sufficient interest in the entity that is the owner of record or holder of legal title. Signature authority: You are entitled to control the disposition of the assets in the account by direct communication with the financial institution maintaining the account

Form 8938: Your income, gains or losses, deductions or credits, process or distributions are required to be reported on your income tax return

What Must Be Reported:

Form FinCEN 114: The maximum value of your accounts that are held and maintained in a financial institution that is physically located in a foreign country

Form 8938: The maximum value of specified foreign assets and other specified foreign non-account investment assets held by foreign financial institutions

Reportable Assets

Form FinCEN 114: Financial accounts at foreign institutions, financial accounts at a foreign branch of a U.S. institution, foreign accounts for which you have signature authority (with exceptions), foreign stock or securities in a foreign institution (the account but not the assets), indirect interests in foreign financial assets through an entity if more than 50 percent interest in the entity, foreign accounts held by a foreign or domestic grantor trust for which you are the grantor, foreign-issued life insurance or annuity contract with a cash value

Form 8938: Financial accounts at foreign institutions, foreign stock or securities in a foreign institution (the account but not the assets), foreign stock or securities not held in a financial account, foreign mutual funds, foreign accounts and foreign non-account investment assets held by a foreign or domestic grantor trust for which you are the grantor, foreign-issued life insurance or annuity contract with a cash value, foreign hedge funds and foreign private equity funds, and foreign real estate held through a foreign entity (the entity itself is a specified foreign financial asset and its maximum value includes the value of the real estate)

IRS FBAR Form Due Dates:

Form FinCEN 114: June 30

Form 8938: The due date of your annual income tax return, including any extensions

Penalties for Non-Compliance:

Form FinCEN 114: If non-willful, up to $10,000; if willful, up to the greater of $100,000 or 50 percent of account balances; criminal penalties may also apply

Form 8938: Up to $10,000 for failure to disclose and an additional $10,000 for each 30 days of non-filing after IRS notice of a failure to disclose your foreign assets in all monetary forms, for a potential maximum penalty of $60,000(approx.); criminal penalties may also apply